diff --git a/src/agents/subagent-announce.ts b/src/agents/subagent-announce.ts
index 444726efc..46d902e80 100644
--- a/src/agents/subagent-announce.ts
+++ b/src/agents/subagent-announce.ts
@@ -192,6 +192,41 @@ async function maybeQueueSubagentAnnounce(params: {
   return "none";
 }
 
+/**
+ * Build a descriptive error status label from outcome data.
+ * Includes error type, message, and hint if available.
+ */
+function buildErrorStatusLabel(outcome: SubagentRunOutcome): string {
+  const parts: string[] = [];
+
+  // Start with "failed"
+  parts.push("failed");
+
+  // Add error type context
+  if (outcome.errorType) {
+    const typeLabel: Record<string, string> = {
+      model: "API error",
+      tool: "tool error",
+      network: "network error",
+      config: "configuration error",
+      timeout: "timeout",
+    };
+    const label = typeLabel[outcome.errorType] || "error";
+    parts.push(`(${label}):`);
+  }
+
+  // Add error message
+  const errorMsg = outcome.error || "unknown error";
+  parts.push(errorMsg);
+
+  // Add hint if available
+  if (outcome.errorHint) {
+    parts.push(`— ${outcome.errorHint}`);
+  }
+
+  return parts.join(" ");
+}
+
 async function buildSubagentStatsLine(params: {
   sessionKey: string;
   startedAt?: number;
@@ -299,6 +334,8 @@ export function buildSubagentSystemPrompt(params: {
 export type SubagentRunOutcome = {
   status: "ok" | "error" | "timeout" | "unknown";
   error?: string;
+  errorType?: "model" | "tool" | "network" | "config" | "timeout" | "unknown";
+  errorHint?: string;
 };
 
 export async function runSubagentAnnounceFlow(params: {
@@ -380,7 +417,7 @@ export async function runSubagentAnnounceFlow(params: {
         : outcome.status === "timeout"
           ? "timed out"
           : outcome.status === "error"
-            ? `failed: ${outcome.error || "unknown error"}`
+            ? buildErrorStatusLabel(outcome)
             : "finished with unknown status";
 
     // Build instructional message for main agent
diff --git a/src/agents/subagent-registry.ts b/src/agents/subagent-registry.ts
index d325e40e2..dca685b72 100644
--- a/src/agents/subagent-registry.ts
+++ b/src/agents/subagent-registry.ts
@@ -184,7 +184,16 @@ function ensureListener() {
     entry.endedAt = endedAt;
     if (phase === "error") {
       const error = typeof evt.data?.error === "string" ? (evt.data.error as string) : undefined;
-      entry.outcome = { status: "error", error };
+      const errorType =
+        typeof evt.data?.errorType === "string" ? (evt.data.errorType as string) : undefined;
+      const errorHint =
+        typeof evt.data?.errorHint === "string" ? (evt.data.errorHint as string) : undefined;
+      entry.outcome = {
+        status: "error",
+        error,
+        errorType: errorType as SubagentRunOutcome["errorType"],
+        errorHint,
+      };
     } else {
       entry.outcome = { status: "ok" };
     }
diff --git a/src/auto-reply/reply/agent-runner-execution.ts b/src/auto-reply/reply/agent-runner-execution.ts
index 21732f49f..36305bc68 100644
--- a/src/auto-reply/reply/agent-runner-execution.ts
+++ b/src/auto-reply/reply/agent-runner-execution.ts
@@ -51,6 +51,85 @@ export type AgentRunLoopResult =
     }
   | { kind: "final"; payload: ReplyPayload };
 
+/**
+ * Categorize errors to provide better error messages to users.
+ * Returns error message, type, and optional hint for remediation.
+ */
+function categorizeError(err: unknown): {
+  message: string;
+  type: "model" | "tool" | "network" | "config" | "timeout" | "unknown";
+  hint?: string;
+} {
+  const message = err instanceof Error ? err.message : String(err);
+
+  // File system errors
+  if (message.includes("ENOENT") || message.includes("ENOTDIR")) {
+    return { message, type: "tool", hint: "File or directory not found" };
+  }
+  if (message.includes("EACCES") || message.includes("EPERM")) {
+    return { message, type: "tool", hint: "Permission denied" };
+  }
+  if (message.includes("EISDIR")) {
+    return { message, type: "tool", hint: "Expected file but found directory" };
+  }
+
+  // API/Model errors
+  if (message.includes("rate limit") || message.includes("429")) {
+    return { message, type: "model", hint: "Rate limit exceeded - retry in a few moments" };
+  }
+  if (
+    message.includes("401") ||
+    message.includes("unauthorized") ||
+    message.includes("authentication")
+  ) {
+    return { message, type: "config", hint: "Check API credentials and permissions" };
+  }
+  if (message.includes("403") || message.includes("forbidden")) {
+    return { message, type: "config", hint: "Access denied - check permissions" };
+  }
+  if (message.includes("400") || message.includes("invalid request")) {
+    return { message, type: "model", hint: "Invalid request parameters" };
+  }
+  if (message.includes("500") || message.includes("503")) {
+    return { message, type: "model", hint: "API service error - try again later" };
+  }
+  if (message.includes("quota") || message.includes("billing")) {
+    return { message, type: "config", hint: "Check billing and API quota limits" };
+  }
+
+  // Network errors
+  if (message.includes("ECONNREFUSED") || message.includes("ETIMEDOUT")) {
+    return { message, type: "network", hint: "Connection failed - check network connectivity" };
+  }
+  if (message.includes("ENOTFOUND") || message.includes("DNS") || message.includes("EAI_AGAIN")) {
+    return { message, type: "network", hint: "DNS resolution failed - check hostname" };
+  }
+  if (message.includes("ENETUNREACH") || message.includes("EHOSTUNREACH")) {
+    return { message, type: "network", hint: "Network unreachable - check connection" };
+  }
+
+  // Timeout errors
+  if (
+    message.toLowerCase().includes("timeout") ||
+    message.toLowerCase().includes("timed out") ||
+    message.includes("ETIMEDOUT")
+  ) {
+    return { message, type: "timeout", hint: "Operation took too long - try increasing timeout" };
+  }
+
+  // Context/memory errors
+  if (message.includes("context") && message.includes("too large")) {
+    return { message, type: "model", hint: "Conversation too long - try clearing history" };
+  }
+
+  // Missing environment/config
+  if (message.includes("missing") && (message.includes("key") || message.includes("token"))) {
+    return { message, type: "config", hint: "Missing required configuration or credentials" };
+  }
+
+  return { message, type: "unknown" };
+}
+
 export async function runAgentTurnWithFallback(params: {
   commandBody: string;
   followupRun: FollowupRun;
@@ -204,6 +283,7 @@ export async function runAgentTurnWithFallback(params: {
                 return result;
               })
               .catch((err) => {
+                const { message, type, hint } = categorizeError(err);
                 emitAgentEvent({
                   runId,
                   stream: "lifecycle",
@@ -211,7 +291,9 @@ export async function runAgentTurnWithFallback(params: {
                     phase: "error",
                     startedAt,
                     endedAt: Date.now(),
-                    error: err instanceof Error ? err.message : String(err),
+                    error: message,
+                    errorType: type,
+                    errorHint: hint,
                   },
                 });
                 throw err;